James Howard
Kunstler es un ferviente crítico de la civilización industrial contemporánea.
Desde su sitio web (kunstler.com) viene advirtiendo sobre la próxima crisis del
petróleo convencional y la esencial inviabilidad de sus sucedáneos caros (shale
oil, arenas bituminosas, etc.). Anualmente escribe un pronóstico para los
próximos doce meses. Acá va su expectativa para el corriente año
(http://kunstler.com/forecast/forecast-2015):
Título: Forecast
2015 — Life in the Breakdown Lane
Texto: “Don’t look
back — something might be gaining on you,” Satchel Paige famously warned. For
connoisseurs of civilizational collapse, 2014 was merely annoying, a continued
pile-up of over-investments in complexity with mounting diminishing returns,
metastasizing fragility, and no satisfying resolution. So we enter 2015 with
greater tensions than ever before and therefore the likelihood that the
inevitable breakdown will release more destructive energy and be that much
harder to recover from.
I don’t know how
anyone can trust the statistical bullshit emanating from our government
reporting agencies, or the legacy news organizations that report them. Yet the
meme has remained firmly fixed in the popular imagination: the US economy has
recovered! GDP grows 5 percent in Q3! Manufacturing renaissance! Energy
independence! Cleanest shirt in the laundry basket! Best-looking house in a bad
neighborhood…!
¡No hay problema!
This is simply
the power of wishful thinking on display. No one — with the exception of a few
“doomer” cranks — wants to believe that industrial civilization is in trouble
deep. The staggering credulity this represents would be a fascinating case
study in itself if there were not so many other things that demand our
attention right now. Let’s just write this phenomenon off as the diminishing
returns of career log-rolling in politics, finance, media, and academia. All
the professional “thought-leaders” pitch in to support the “hologram” of
eternal progress that issues their paychecks and bonuses. This culture of
pervasive racketeering that we’ve engineered has made us obtuse. The particular
brand of stupidity on display also points to another signal vanity of our time:
the conviction that if you measure things enough, you can control them.
I’m of the view
that the measurers only pretend to measure and can only pretend to control
things, especially in the most fragile of the systems that we depend on for
running all the other systems of techno-industrial economic life: finance. The
pretense has endured a lot longer than many of us had expected. The legerdemain
employed by banking officials and their handmaidens was greatly augmented by
the sheer wish that fragility (i.e. risk) had been successfully and permanently
banished from the universe. That “magic” at least sustained a universal faith
in currencies until the middle of last year when so many monies went south —
except the dollar, levitating on blowback of the deflationary wind flattening
everything else.
All this
unreality in money and markets should be expected in the conditions just
preceding systemic collapse of an entire trans-national industrial
civilization, just as one should expect societies to construct their most
grandiose monuments to themselves shortly before collapse. The Mayans R us. One
year, they were cavorting bloodthirstily atop their garish painted pyramids and
a generation later the jungle was stealing back over the temple steps and the
population was a tenth of its former size. The same thing is going to happen to
us, except there will be a hell of a lot more worthless, toxic debris left on
the landscape.
Of course, even
that is a more long-term projection than the exercise at hand calls for, viz.,
the forecast for measly little 2015. So without further throat-clearing, permit
me to break it down for you:
Finance and
Banking
As 2014 closed
out, that kit-bag of frauds, swindles, Ponzis, grifts, bait-and-switches, and
three-card-monte scams is looking at least as wobbly as it did in 2007 when
Wall Street was busy manufacturing booby-trapped MBSs and CDOs. Except we know
the true aggregate risk at stake has only grown larger and more hazardous due
to all the strenuous efforts by authorities since the panic of 2008 to evade
any natural process for clearing mal-investment and debt gone bad. A lot of
that stank was simply shoveled into the Federal Reserve’s basement, where it
sits to this day, composting steamily. As to be expected (and averred to in my
previous books and blogs) financial repression, market intervention, and statistical
distortion will produce ever more financial perversity. That is the hazard in
decoupling truth from reality. Imposed dishonesty will always express itself in
unexpected ways. Who expected the price of oil to fall by nearly half in a few
months? (More on that below.)
These days,
perversity expresses itself in a morbidly obese dollar gorging on junk while
bulimic currencies elsewhere projectile-vomit their value away as the economies
attached to them die of malnutrition. Perhaps this comes as a surprise to
central bankers standing at their control panels like recording engineers at
the soundboard, tweaking all the dials and slides expecting to achieve a
perfect repressive inflation rate of 2-plus percent so they can melt away the
onerous debt of sovereign balance sheets and Too Big To Fail banks —
incidentally squeezing the citizenry of purchasing power in small annual
increments that add up, after a while, to worthless money. They did manage to
extend the inflation of stock market indexes another year, which the public is
supposed to interpret as “prosperity.” Half a trillion dollars in stock
buybacks of S & P companies were executed in 2014, much of it done with
money, i.e. “leverage,” borrowed at zero interest. Stock buybacks boost share
prices, of course, but they don’t represent any real increased value in a given
company. They’re just snakes eating their own tails.
The belief that
the world’s “reserve” currency is an implacable force, and that central bankers
are omnipotent has made this trade appear to be an irresistible trend — Don’t
fight the Fed! Since it’s a matrix of fraud based on thin air money detached
from real productive activity, it is certain to blow up. And since 2015 is
seven years past the last blowup, it can happen any time. All it requires is
some small slippage somewhere, that one equivalent extra grain of sand or
snowflake to bring the accumulate mass of false value down in a financial
earthquake or avalanche. That obese dollar has been gorging on the equivalent
of cheez kurls and Little Debbie Snack cakes, so it only grows more diseased as
it gains weight. Sentient observers cannot fail to notice the advancing
sickness.
Meanwhile, the US
is stupidly waging currency war against other nations that can only blow back
by incurring the animosity of every trading partner we have on the only planet
available to live on. In 2015, I expect Russia to enlist China’s aid in
undermining the dollar’s reserve status. Both countries have weaponry in the
form of cash reserves and gold in their vaults. They also have the computer
hacking expertise to start seriously messing with US markets — as much Fed
technicians and TBTF bank algos do — bringing on mysterious flash crashes,
derivatives “accidents,” and other abnormal events that will leave even the
Goldman Sachs MIT graduates scratching their heads. Such hacking may accomplish
what years of arrant market interventions by US technicians failed to produce:
a deadly loss of faith on all the institutions that govern money and markets.
Then the US will be the cleanest shirt in a laundry basket that is on fire.
The dollar these
days represents two kinds of capital. The first is the stuff that the US has
built and invested in since, say, the end of World War Two: a wasteland of
aging and decrepitating suburban sprawl, that is, the infrastructure of a
living arrangement with no future, the greatest entropic sink in human history.
It extends to whole cities and their subsystems, e.g. the hell-hole of Las
Vegas with Hoover dam and the dwindling reservoir of Lake Mead. Before
mid-century, Las Vegas will be as desolate as Egypt’s Valley of the Kings. Try
to imagine the money that went into building all that stupid shit in the
desert. In another decade, across America, the housing subdivisions and commercial
highway strips filled with tilt-up box stores, muffler shops and burger
dispensaries will retain less value than the pyramids of Palenque had for the
Mayans after their society rolled over and died. The so-called real economy is
a New Age serfdom of burger fryers and janitors, indentured to that entropic
sink. Below them is a widening slough of methedrine, child abuse, and tattoo
art on its way to becoming Soylent Green. To put it bluntly, the dollar is
entropy’s algo bitch.
The second kind
of capital the dollar represents is the imaginary value based on sheer lying,
making shit up, and borrowing from a future that has no chance of being paid
back. This is the capital ginned up on “American exceptionalism” and “energy
independence,” fairy tale memes functioning as collateral for the
aforementioned malinvestments that add up to “The American way of life.” This
capital has no substance, since it is just made up of intellectual and
emotional dishonesty. This is the kind of constructed narrative that addicts
and other functional cripples resort to to justify their behavior, and the
fragility of it will sooner or later lead to the well-known condition of
“hitting bottom.” That is the event horizon where the remnants of America enter
what I call the World Made By Hand. It will be the greatest socio-economic
shift since the fall of Rome, only much swifter.
Oil
It really
deserves a sub-category of its own because it is the primary resource of our
techno-industrial society and its troubles lie behind much of the present
disturbances of our times. Despite the triumphal agitprop of the past few
years, peak oil is for real. It just manifests more strangely than most people
thought, namely, the simpleminded idea that it would only show up as
ever-rising prices. No, I made point in The Long Emergency (2005) — and other
commentators did too — that peak oil would manifest as volatility. And so since
the actual moment of peak conventional crude around 2005, we’ve seen pretty
wild oscillations in the price of oil. This is due to the harsh reality that
the price people and enterprises can afford to pay for increasingly
harder-to-get oil is less than the price that makes it possible to get it. This
sets up a yo-yo-ing instability in economic performance that exacerbates even
normal wave patterns in the business cycle (which are, in turn, aggravated by
banks and governments’ interventions such as ZIRP to suppress those cycles).
Below $70-a-barrel the producers go broke; above $70-a-barrel the customers go
broke. So the price wobbles up and down as financial Ponzis like shale oil are
introduced onto the scene in the hope that debt finagling and mineral rights
leasing scams can substitute for physics and geological reality. One trouble
with this is that each violent oscillation generates more economic and
financial destruction. Activities like motoring, aviation, manufacturing, and
retail are badly affected and the entire financial system is made more fragile
by worsening increments. Most importantly, the cost structure of the oil
industry itself gets battered to a degree that fewer companies can survive to
produce the remaining oil.
The big story for
2014 was the crash of oil prices. It is yet being celebrated in other blogger’s
2015 forecasts as a boon to America. Wait until they find out that almost all
of the “good jobs” added in recent years were associated with the shale
drilling industry that is now being put out of business by low oil prices. Wait
until they find out how the failure of junk bond financing thunders through the
bond markets and the savage wilderness of derivatives — and ultimately into
their ruined pension funds. Wait until they discover that it was but a symptom
of the compressive deflationary depression now gripping the entire
techno-industrialized world.
Here are my
financial forecast particulars for 2015:
-Early in 2015
the ECB proposes a lame QE program and is laughed out of the room. European
markets tank.
-Greek elections
in January produce a government that stands up to the EU and ECB and causes a
fatal slippage of faith in the ability of that project to continue.
-Second half of
2015, the rest of the world gangs up and counter-attacks the US dollar.
-Bond markets in
Europe implode in first half and the contagion spreads to the US as fear and
distrust rises about viability of US safe haven status.
-Derivatives
associated with currencies, interest rates, and junk bonds trigger a bloodbath
in credit default swaps (CDS) and the appearance of countless black holes
through which debt and “wealth” disappear forever.
-US stock markets
continue to bid upward in the first half of 2015, crater in Q3 as faith in
paper and pixels erodes. DJA and S & P fall 30 to 40 percent in the initial
crash, then further into 2016.
-Gold and silver
slide in the first half, then take off as debt and equity markets craters,
faith in abstract instruments evaporates, faith in central bank omnipotence
dissolves, and citizens all over the world desperately seek safety from
currency war.
-Goldman Sachs,
Citicorp, Morgan Stanley, Bank of America, DeutscheBank, SocGen, all succumb to
insolvency. American government and Federal Reserve officials don’t dare
attempt to rescue them again.
-By the end of
2015, central banks everywhere stand in general discredit. In the US, the
Federal Reserve’s mandate is publically debated and revised back to its
original mission as lender of last resort. It is forbidden to engage in further
interventions and a new less-secretive mechanism is drawn up for regulating
basic interest rates.
-Oil prices creep
back into the $65 – $70 range by May 2015. It is not enough to halt the
destruction in the shale, tar sand, and deepwater sectors. As contraction in
the failing global economy accelerates, oil sinks back to the $40 range in
October…
-…unless mischief
in the Middle East (in particular, the Islamic State messing with Saudi Arabia)
leads to gross and perhaps fatally permanent disruption in world oil markets —
and then all bets are off for both the continuity of advanced economies and for
peace between nations.
Geopolitics
The signal event
of 2015 will be the disintegration of Tom Friedman’s global economy, the trade
and banking relations we have known for about a quarter century, especially the
frictionless flow of goods and capital between East and West. The tactical
blunders of the USA and its Euro-partners drive the so-called emerging markets,
led by China’s Shanghai Cooperation Organization, into a skein of work-arounds
to undermine and avoid the US dollar trade. They don’t exactly replace the
dollar as the world’s reserve currency but the workarounds lead to a period of
worldwide currency turmoil that can only be resolved by monies being at least
partially backed by gold. Both China and Russia will continue to work to
convert their dollar reserves into Gold whenever possible. Meanwhile, America
and Great Britain’s campaign to discredit and devalue gold will only permit
their rivals to acquire more at a cheaper price.
The rest of the
world is sick of America’s interventionist shenanigans and its moronic exported
culture of burgers, Grand Theft Auto, and twerking Jezebels. They are aided by
America’s own obdurate foolishness and poor strategic choices, for instance the
blowback from the Ukraine misadventure of 2014. Who in the White House,
Pentagon, or State Department thought it was a great idea to undermine the
fragile stability of Ukraine? Is there any question that Ukraine was ever not
in Russia’s sphere of influence? Or that Russia would allow it to be dragooned
into NATO and used as a forward base for American firepower? Dmitry Orlov’s
explanation for all this is the most cogent on the web:
“What the
Anglo-imperialists were paying for in corrupting Ukraine’s politics was a
ring-side seat at a fight between Ukraine and Russia. And what they got instead
is a two-legged stool at a bar-room brawl between Eastern and Western Ukraine.”
Read the whole
darn thing; it’s not long.
We succeeded in
turning a marginally-bankrupt, marginally-independent nation into a complete
basketcase that is going Dark Age as I write — no money, no work, no fuel, no
heat, no food, no prospects. Having completely botched the operation, and
misplayed the game against Russia’s Putin — and Russia’s legitimate interest in
a stable next-door neighbor — the US will now abandon Ukraine. It will be
forgotten as surely as the US-sponsored Ukrainian air force’s role in the crash
of Malaysian Airlines Flight 17 — the incriminating details of which were
buried by the Dutch investigating officials. Eventually, the Russians will have
to care for the dying Ukraine. They will not be enthusiastic about it. They
will do little and do it slowly.
Likewise our
economic sanctions campaign against Russia (including the attack on the ruble)
is now blowing back on the Eurozone’s export economy. Russia has survived much
worse than Western sanctions in recent history. Russia will survive by turning
east to Asia. This is already happening and is well publicized. What it means
for Europe sooner than later is the loss of their access to imported oil and
gas from Russia. Meanwhile, the North Sea fields and the Dutch Groningen gas
field are dying. Good luck staying warm, Europe.
The blowback of
Europe’s foolish partnership with the US campaign to punish Russia can only
discredit the ruling parties and boost new right-wing parties such as France’s
National Front and Britain’s UK Independence Party, both deeply nationalistic,
anti Euro Union, and anti endless immigration.
The Islamic State
was another legacy of blowback from American foreign adventurism. It was
spawned out of the remnants of Al Qaeda in poor, broken Iraq and its conquests
in 2014 ranged clear across northern Syria to several major cities in Iraq
(Faluja, Tikrit, Mosul) right up to the suburbs of Baghdad. They made a lot of
money off of captured oil wells and ransoming western hostages, and they
shocked Western decency with their YouTube decapitations of hostages that the
US and UK refused to ransom. The US’s response now is to bomb their
installations and bivouacs. That can only drive them, literally, underground.
IS will thrive on Western punishment. It has vast potential to recruit the
population of idle, under-employed young men all across North Africa and the
Middle East, and beyond to Europe and the band of Islamic society that
stretches below Russia across mid-Asia. The catch is, if and when they come to
actually rule most of these territories, they will be running economies reduced
to Dark Age levels.
As I write, King
Abdullah of Saudi Arabia has just entered the hospital. At 91, he is closer to
the end of his story than the middle. Meanwhile, the tanking of crude oil
prices has critically impaired an Arabian economy that depends on oil sales for
more than 80 percent of its operating revenue. Much of that revenue goes to a
national welfare system that pays just about everybody to not work. There will
be a lot less money to go around now and a lot of grievance over it. The
population of the Arabian Peninsula is so far beyond critical overshoot that
the situation can only get ugly, especially since a large part of that
excessive population consists of testosterone-jacked young men under 30 with
nothing to occupy their hours but chitchat over tea and religious mummery.
Consider also that when King Abdullah goes, there is liable to be a deeply
destabilizing fight for the throne among the hordes of princes and competing
clans — despite whomever Abdullah has named as his successor. You may be sure
the Islamic State will be standing by to add fuel to those fires. That, in and
of itself, could bring on a fast end of the oil age. Bear in mind, too, that
the eastern side of Saudi Arabia, where most of the oil infrastructure is,
contains a majority Shi’ite population. In a conflict between Sunni IS and
Iran-backed Arabian Shia, a lot of stuff could just get blown up. At the least,
itr could badly interrupt 30 percent of the world’s oil supply.
China is
obviously struggling to prevent a financial freefall brought on by 20-plus
years of extravagant debt creation and a lot mal-investment in the service of a
very late entry into the techno-industrial frolic. It can’t be denied that they
made a good show of it in a very short time, but they got in at the blow-off
stage. Now conditions are changing unfavorably. The global economy that made
China the world’s workshop is unwinding in a vortex of currency war, trade
friction, territorial dispute, ethnic ill-will, and the disturbances that
attend the great background problem of peak cheap oil.
The Chinese will
work sedulously to try for a soft landing in the great economic contraction
that looms. Chinese banking being non-transparent, overly subject to blundering
central control, and deeply corrupt, may not bode well for that project.
However, China has many cushions to fall back on short-term in the form of
foreign money reserves and stockpiles of raw materials. But sooner or later
they have to reckon with their dependence on continued oil imports. That is
clearly the basis of China’s current flirtation with Russia — but with Russia
arguably past its own oil production peak, that’s not a long-term strategy.
China has cranked up the world’s mightiest production line of photovoltaic
hardware, but solar won’t replace oil the way things currently run, and
whatever they rig up may not last more than one generation if there’s no
supporting platform of an oil economy for the manufacture of solar replacement
parts.
Japan’s suicidal
experiment with hyper-turbo ZIRP and QE is not accomplishing much except
exacerbating global currency carry trades and driving down the nation’s
standard of living. It may succeed in destroying the Yen and what remains of
its economy in 2015. Fukushima remains unresolved and Japan’s energy future
looks plain dismal. They have no energy resources of their own whatsoever. Any
serious mischief in the Middle East oil fields will finish them off. The nation
has been on the fast track to become the first post-industrial neo-medieval
society. They could be fortunate to land back there and set up their shop while
there are still residual riches in the world to work with. They might also go
cuckoo and start a war with China for control over the oil fields of the South
China sea. It is hard to see any other outcome from such a conflict other than
China kicking Japan’s ass.
Geopolitical
forecast particulars for 2015
-Russia toughs
out sanctions imposed by the USA; European partners drop their sanctions as
self-evidently counter-productive. Russia threatens to post-pone debt
repayments to Western banks. The ruble stabilizes.
-Russia endures
Islamic terrorist attacks and responds very harshly, embarrassing the wimpy
West.
-Baghdad Falls to
Islamic State forces. Years of American endeavor are lost just like that. The
IS attempts to use Iraqi oil reserves to fund its operations. It has a hard
time keeping the infrastructure in repair. The USA refrains from bombing Iraqi
oil installations, a decision viewed as weakness by IS.
-The Islamic
State makes inroads across North Africa. Libya, Egypt, Algeria, Tunisia,
Morocco are all susceptible.
-Formerly
marginal political parties win big across Europe, forcing nations to rethink
wide-open immigration policies. Neo-liberalism sinks into deep Weimar-style
discredit. Open ethnic warfare breaks out in France, Britain, the Netherlands,
Sweden.
-European
economies continue to sink for the simple reason that the growth era of
techno-industrialism is over, along with affordable oil, and no amount of debt
production will bring it back. All the machinations of the EU and the ECB are
dedicated to overcoming this implacable reality, and thus will only lead to
deeper and more intractable problems.
-Beginning with
the late January elections, which Alexis Tsipras’s Syriza party wins, Greece
plays hardball with the EU for debt restructuring that amounts really to
forgiveness of utterly unpayable €322 billion ($398 billion). If the EU calls
Greece’s bluff and kicks them out, a European banking meltdown is almost
certain. If Greece stays, then other hopelessly indebted nations of the EU
declare they want the same deal. Pretty much a rock and hard place. Impossible
to call except to say the situation promises mucho turmoil in 2015. ¡Hay
problema!
-Ebola contagion
persists and rips across sub-Saharan Africa. Other nations are forced to pass
severe travel restrictions to-and-from Africa.
-Nigeria descends
into bloody political turmoil as its oil industry falls apart in response to
low prices. UN intervention accomplishes nothing. In wartime conditions, Ebola
gains a foothold in Lagos, one of the world’s most overpopulated slum cities.
-Pakistan and
Afghanistan both continue to melt down into ungovernability. India is forced to
take over administration of Pakistan and remove nukes. America continues to
pretend that its mission in Afghanistan has some purpose, but it only remains a
black hole of military expenditure and becomes a rancorous issue in the run-up
to the 2016 Presidential election.
The USA Homefront
2015
For one who has
been a close observer of the US socio-political-economic scene since the
Kennedy era, the nation has gotten itself into a pretty sorry state. The
pervasive racketeering that poisons American life from the money-in-politics
farce, to the shameless, chiseling medical-pharma cabal, to the SNAP-card and
disability rights empire of grift, to the college loan swindle, to the
disgusting security state apparatus, to the corporate tyranny of local life and
economies, to the delusional techno-narcissism of the media, to the despotic
and puerile gender preoccupations of academia — all of it adds up to a society
that cares as little for the present as it does for the future. And that’s
aside from the pathetic digital device addiction of the generation coming up,
and the sheer sordid behavior of the tattooed, drug-saturated, pornified masses
of adults now forever foreclosed from a purposeful existence or a decent
standard of living.
Even physically
America is a sorry-ass spectacle: between our decrepitating cities, abandoned
Main Streets, gruesome strip-mall highways, repellent and monotonous suburbs,
dreary industrial ruins, profaned countryside, and desecrated coastline, there
is little left to actually love about This land is Your Land. We’ve made so
many collective bad choices about how we live that one can’t help feeling we are
simply a wicked people who deserve to be punished.
Whole classes
already are, of course. What used to be a working class with aspirations has
devolved to the forlorn savagery averred to above. Our thought-leaders are
devoid of thought. Our hopes and dreams are absurd sci-fi fantasies prompting
us toward robot-assisted suicide. Our political stratagems of recent years
accomplish nothing except making more trouble for ourselves while inciting the
enmity of people elsewhere.
Barack Obama’s
signal failure — aside from letting the banks get away with murder and omitting
to counter the Supreme Court’s Citizens United decision — has been his total
evasion of measures that would prepare the nation for the vast changes in
social and economic imperative that will attend the transition out of the
techno-industrial era when he is out of office. These include supporting local
small scale agriculture (rather than giant corporate agri-biz); promoting and
supporting the reconstruction of local economic networks (Main Street
business); eliminating multitudinous federal regulations that prevent
individuals and small enterprises from operating; closing the hundreds of
superfluous US military bases around the world; giving federal support to
rebuild the US passenger rail system; promoting walkable communities —
especially the re-activation of existing small towns and cities — instead of
mindless obeisance to the suburban “home-building” industry (and its step-child
in the commercial highway strip development racket) — and truly reforming
medical care without the connivance of the insurance racketeers.
Obama and his
party can be faulted for fostering the myth that every young person needs a
college degree — leading a whole generation into debt penury for no good
purpose, while depriving society of a long list of vocational roles and
livelihoods based on providing genuine service or value. We will be a nation of
unemployed gender studies graduates instead of plumbers, electricians, organic
farmers, arborists, carpenters, machinists, nurses and paramedics, small
business owners, et cetera.
This enormous
bundles of myths and misplaced expectations for yesterday’s tomorrow prevents
the collective national imagination from summoning a revised American Dream
based on repairing the massive destruction of recent decades.
The political
mood has not been murkier in my longish lifetime. Both major parties edge
toward extinction as the Whigs did in the mid-1850s. The citizenry not sunk in
drugs and depravity — that is, people who still read the news in some form and
would like to care about their country — deserve a new faction or party that
can at least express their discontent with the current situation. They will
surely not get this in the generally supposed coming contest between Hillary
Clinton and Jeb Bush. I hope they will be so insulted by this dynastic grab
that more than one new party will form and make a big stank about it. The Tea
Party was a good start in that spirit, but it tripped on its internal
contradictions and its association with Dixieland-style religious
fundamentalist idiocy and cracker war-mongering.
All that redounds
on the current state of the Republican Party, a gang of venal ignoramuses
pimping for lost causes. Despite having won the 2014 midterms, and capturing
both houses of congress and governorships, they seem increasingly out-of-touch
with the realities of economic contraction, peak oil, and climate
irregularities. The old magic of stirring up the animals on social issues of
abortion, bedroom activities, and allegiance to Jesus fail to move the old
base, which is becoming economically quite desperate. That base also becomes
conscious of how they have been hornswoggled into voting against their own
interests for years in the sense that author Thomas Frank so aptly described in
What’s the Matter With Kansas.
Race relations
turned very sour in 2014 with more highly publicized killings of young black
men in ambiguous circumstances. The chief martyr of the year, Michael Brown of
Ferguson, Mo., was a poor candidate for sainthood, and did not help advance the
credibility of claims that police brutality rather than the misbehavior of
young men is behind a lot of strife abroad in the land. One gets the feeling
that black race hustlers are in the driver’s seat recklessly pushing African
Americans toward open warfare with everybody else. My view of the situation is
not popular with Progressives, viz: that black separatism and its offshoots in
“diversity” politics and multi-culturalism tragically promote an antagonistic,
alienated, oppositional black politics at the expense of a common culture for
blacks and whites with common values and common standards of behavior. It has
gotten so bad that reasonable people can sadly conclude that the long civil
rights project has ended in failure. We are treading on dangerous ground here,
with foolishly outmoded ideas about what to expect from each other, and of
course all this begs the questions: What now? What next?
Domestic Forecast
Particulars for 2015
-Markets tanking
in Q3 destroy the illusion of “recovery.” It becomes obvious that the story was
a lie and the public mood grows much more surly.
-2014 proves to
be the year of peak shale oil. After the shakeout of 2015 due to low oil
prices, production never returns to previous levels. The fairy tales of “energy
independence” and “Saudi America” fall apart, deeply demoralizing a gulled
public and adding yet another layer of discredit to the people in charge of
things.
-Different kinds
of political revolt break out around the country among varied groups, left,
right, and center. Some of it revolves around life-and-death struggles for the
souls of the floundering major parties. Some of it is organized violence
against the government and especially against the US security state apparatus,
including overly militarized local police forces.
-Low-grade racial
warfare erupts across the US. Flash mobs, knock-out games, lootings, and hammer
attack type outrages generate counter-attacks. By summertime the conflict heats
up. Firefights become routine and casualties mount. President Obama proves to
be tragically ineffectual in restoring peace.
-Anti-immigration
sentiment in Europe spreads to the US as falling oil prices produce political
disorder in Mexico prompting tens of thousands to try to flee north.
-Bank of America
is the first of the Too Big To Fails to enter the event horizon of failure.
Obama can’t get congress to go along with a bailout. By Thanksgiving, there is
turmoil among the banks as they scramble to cover losses. A public furor over
using taxpayer money to cover derivatives losses leads to an unprecedented
concerted action by states to attempt “nullification” campaigns.
Citibank applies
for a bail-in of account holders. Dithering, frightened federal authorities are
too slow to respond, permitting a run on deposits.
-Hillary is
loudly booed and hectored at campaign stops as “a tool of Wall Street.” Her
coffers overflow with TBTF bank contributions. She bows out of the presidential
contest as the public mood toward her sours. But not before she generates a lot
of resentful opposition and alienates many Democratic Party voters who are also
furious over the eight-years of Obama’s “hope” and “change” hand-jive.
Elizabeth Warren is dragooned to replace her — dubbed the “Un-Hillary” —
rescuing the party from a near-death experience. She openly feuds with party
bosses, who plot against her, and undermine her campaign.
-Senator Rand
Paul agitates to abolish the Federal Reserve. His senate colleagues are shamed
into considering legislative reform of the Fed’s mandate. Debate on the issue
is the only thing the Republican dominated congress and senate accomplish in
2015. Paul decides to challenge Jeb Bush for the 2016 nomination. This blows
the Republican party apart.
-At Christmas
2015, the DJA sits at 13,500, the S & P is at 1200. Gold is at 1750, silver
at 42.
Good luck
everybody. Gird your loins and fasten your seat belts.
